Going forward, area wineries show plenty of promise

wineryThe Grand Traverse Region continues to be the focus of agriculture and agri-tourism. One area that fits into this sweet spot is the popular growth of the area’s vineyards and wineries. There are many reasons why wine grapes are beginning to challenge the dominance of cherries as the region’s major commodity.

The transition into grapes includes benefits to the local economy that are advantageous compared to cherries and other tree harvested fruit. Grape production is likely part of a winery operation that stresses the additional value added components of bottled wine (retail and wholesale sales), tasting rooms, bed & breakfasts, and on site events.

Markups and profit margins on these value added elements are much higher than traditional cherry wholesale production. Labor associated with grape farming in most case pays employees a higher wage and offers more year-round employment than cherry farming.

Grand Traverse and Leelanau counties make up more than half of Michigan’s grape and wine production. With 14,600 acres of vineyards and 2,000 acres devoted to wine grapes, Michigan is ranked as the fourth largest grape growing state, and eighth in wine grape growing production. In 2008 the Michigan wine industry attracted more than 800,000 visitors.

At last count (which seems to change by the day), Grand Traverse County boasted a total of seven production wineries, and Leelanau County 14, amounting to an increase of roughly 33% in the last ten years.

Even in our recession type economy, the statistics show a macro trend towards additional wine consumption:
• Consumption of table wine increased with red wine usage outpacing that of white, due in part to high consumer awareness of its health benefits.
• Wine consumption increases with age. Less than a quarter of young adults aged 21-24 drink wine, compared to 41% of adults aged 55-64
• During 2003-08, the frequency of drinking domestic wine increased 2% while that of drinking imported wine rose 1%, which equates to 809,000 more drinks consumes in 2008, compared to 2003.
• Consumers aged 25 to 34 who drink wine report spending more per bottle of wine than any other age group, making a ripe target for wine marketers.

Additional information broad-based macro market studies show two distinct secondary markets for U.S. and Midwest U.S. wine consumption. The first is adults between the ages of 55-64, while the second includes consumers between 25 and 34.

Meanwhile, year-round population figures and projections for the Grand Traverse Region going forward show that these same age groups will grow significantly in the next few years compared with other population sectors. One needs to remember that these figures are based on the area’s year-round population and do not include the large influx of seasonal visitors and residents.

What remains clear is that the Grand Traverse Region continues to produce more nationally and internationally acclaimed wine, the region is becoming known for good quality wine, and that the future looks bright for the area’s wine producers.

This entry was posted in Partner Resources, Resources, SBTDC and tagged , , . Bookmark the permalink.

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out /  Change )

Google+ photo

You are commenting using your Google+ account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )


Connecting to %s